Bitcoin Brokers & Exchanges
Bitcoin brokers and exchanges provide tools to help traders capitalize on the BTC crypto market, either through owning the underlying asset or speculating on a derivative. However, selecting Bitcoin platforms is not straightforward, with different services offered and fees charged by each exchange.
In this tutorial, we review the most important factors to consider when choosing Bitcoin brokers, including regulations, platforms, mobile apps, plus safety and security measures. Alternatively, get started today with our rating of the best Bitcoin brokers and exchanges in 2023.
Bitcoin Brokers & Exchanges
#1 - Forex.com
Trade major cryptos against USD, EUR, GBP and AUD. All traded with tight spreads. No virtual wallet is required, just a trading account. Cryptos are not available in the US, UK or Canada.
"Forex.com is an excellent broker for forex traders with over 80 currency pairs, tight spreads, low commissions and powerful platforms. The brand is also heavily regulated while its parent company is listed on the NASDAQ, giving it a high trust score."
- DayTrading Review Team
- Crypto Spread: BTC 1.4%, ETH 2%
- Crypto Lending: No
- Platforms: MT4, MT5, TradingView, eSignal, AutoChartist, TradingCentral
- Crypto Staking: No
- Minimum Deposit: $100
- Regulator: NFA, CFTC
About Forex.com
Forex.com boasts a global reputation with multiple awards and 20+ years experience. Regulated in the US, EU, UK and Canada they provide a huge range of markets, not just forex, and offer competitive fees on a cutting-edge platform. The brand also provides a suite of additional tools, from performance analytics and SMART Signals to advanced charts and strategy builders.
Pros
- Up to 15% cashback rebates for active traders
- Top-rated forex and CFD broker
- Fast execution speed of less than 1 second
Cons
- $15 monthly inactivity fee
- No copy trading platform
- Investment offering varies between countries
#2 - Interactive Brokers
Buy and hold Bitcoin, Bitcoin Cash, Ethereum and Litecoin with low commissions of 0.12%–0.18%. Fees are low and the broker offers a secure environment to invest in digital assets.
"Serious traders seeking a regulated broker with unparalleled access to stock markets should look at IB. Their range of stocks can't be beaten."
- DayTrading Review Team
- Crypto Spread: Variable
- Crypto Lending: No
- Platforms: AlgoTrader, OmniTrader, eSignal, TradingCentral
- Crypto Staking: No
- Minimum Deposit: $0
- Regulator: SEC, FCA, IIROC, SFC
About Interactive Brokers
Interactive Brokers is a leading global brokerage that provides access to a comprehensive offering of stocks as well as forex, futures, metals, bonds and cryptos. The firm has over 40 years experience in the online trading industry and is heavily regulated by SEC, FCA, IIROC, and SFC. Traders use the proprietary Trader Workstation and can access powerful tools and data feeds as well as comprehensive educational resources.
Pros
- Direct market access, including to the FTSE 100 index, the CAC 40 and Germany’s DAX 40
- Gives retail traders unmatched access to global stocks with tens of thousands available from 100+ market centres in 24 countries
- You can trade from multiple account types, such as IRA, single registered, joint
Cons
- Mediocre customer support
- Due to the pricing structure, this firm can be more expensive for aggressive traders who trade over $100,000 shares a day
- The TWS platform falls short in terms of technical charting
#3 - NinjaTrader
Trade micro Bitcoin futures with low fees and leading charting tools. Get exposure to Bitcoin through CME Group's centralized exchange with robust risk management tools.
"We recommend NinjaTrader for high-volume futures traders looking for low fees and premium analysis tools."
- DayTrading Review Team
- Crypto Spread: Floating
- Crypto Lending: No
- Platforms: eSignal
- Crypto Staking: No
- Minimum Deposit: $50
- Regulator: NFA, CFTC
About NinjaTrader
NinjaTrader is a US-headquartered and regulated brokerage that specializes in futures trading. There are three pricing plans to suit different needs and budgets, as well as ultra-low margins on popular contracts. The brand's award-winning charting software and trading platform also offers a high-degree of customization and superb technical analysis features.
Pros
- Thousands of add-ons and applications from developers in 150+ countries
- Low fees with $50 day trading margins & commissions from $.09 per micro contract
- Widely respected and heavily authorized by the NFA and CFTC
Cons
- Non forex and futures trading requires signing up with partner brokers
- Premium platform tools come with an extra charge
- Withdrawal fee on some funding methods
#4 - eToro USA
eToro US leads the way in cryptocurrency trading. 1% fee for buying or selling crypto added to the spread (from 0.75% for BTC), with their own wallet service and the largest number of cryptos to trade in the market. eToro copy trading is only for cryptos. Crypto asset investing is highly volatile and unregulated. No consumer protection. Tax on profits may apply.
"eToro is a top pick for users looking for social investing and copy trading. With a low deposit, zero commissions and an intuitive platform, the broker will meet the needs of newer traders."
- DayTrading Review Team
- Crypto Spread: BTC 0.75%
- Crypto Lending: No
- Platforms: Own
- Crypto Staking: No
- Minimum Deposit: $10
- Regulator: SEC, FINRA
About eToro USA
eToro is a social investing platform that offers stocks, ETFs, options, and crypto. The broker is well-known for its user-friendly community-centred platform and competitive fees. With FINRA and SIPC oversight and millions of users across the world, this brand is highly respected. eToro securities trading is offered by eToro USA Securities, Inc.
Pros
- The online broker offers an intuitive social investment network with straightforward copy trading on cryptos
- The $10 minimum deposit and straightforward account opening process means beginners can get started quickly
- A free demo account means new users and prospective traders can try the broker risk-free
Cons
- No MetaTrader 4 platform integration
- Narrower range of instruments than some competitors
#5 - OANDA US
Speculate on the world's biggest cryptos by market cap. Commissions are lower than many peers starting at 0.25%. Clients can spot trade cryptocurrencies on Paxos's itBit exchange through the OANDA platform via OANDA’s partnership with Paxos. Users can trade digital currencies in a few taps through the iOS and Android mobile app.
"OANDA is a top-rate broker for US traders seeking a user-friendly platform with premium market research and a straightforward joining process. OANDA is a particularly good pick if you want a heavily regulated broker with a secure trading environment."
- DayTrading Review Team
- Crypto Spread: $100
- Crypto Lending: No
- Platforms: MT4, TradingView, AutoChartist
- Crypto Staking: No
- Minimum Deposit: $0
- Regulator: NFA, CFTC
About OANDA US
OANDA is a popular brand offering exceptional execution, low deposit requirements and advanced charting and trading platform features. The top-rated brand has over 25 years of experience and is regulated by trusted agencies, including the NFA/CFTC. Around the clock support is available, alongside flexible contract sizes and automated trade executions.
Pros
- API facilitates access to 25 years of historical data and rates from 200+ currencies
- Reliable, trustworthy and secure brand with authorization from tier-one regulators
- The OANDA web platform offers advanced price charts and graphs
Cons
- Customer support not available on the weekend
How Do Bitcoin Brokers & Exchanges Work?
First, it’s important to understand the difference between a Bitcoin broker and an exchange.
Similar to forex, a Bitcoin exchange is simply a platform for users to deposit funds that can be exchanged for Bitcoin. This means the investor becomes the owner of an amount of Bitcoin, which needs to be stored in a crypto wallet. An exchange makes its money on the difference between the ask and sell price.
Bitcoin brokers act as middlemen between buyers and sellers to facilitate a trade. As well as having the option to buy the Bitcoin asset, brokers also allow investing on derivative products such as CFDs and binary options, enabling the trader to profit from price fluctuations without owning or storing any BTC itself. This is a key advantage of using a Bitcoin broker, with these derivative options also allowing the trader to use leverage. For traders that simply want to buy and hold or use Bitcoin, an exchange may be a good alternative.
Investors looking to buy or sell a large amount of Bitcoin will likely use an over-the-counter (OTC) broker, who finds a counterparty directly rather than trade on an exchange. This has benefits such as preventing the investor from impacting their own price point and avoiding slippage.
How To Compare Bitcoin Brokers & Exchanges
Here we discuss the most important factors to consider when comparing Bitcoin brokers.
Fees
Bitcoin fees are usually a percentage of the crypto value being purchased, though flat fees may also apply per transaction. In addition, expect to pay borrowing fees if holding a short position, conversion fees when depositing in certain currencies, account inactivity fees if the account becomes dormant, and rollover fees to hold an overnight position.
Financial Derivatives
Many Bitcoin brokers offer the option to speculate on financial derivatives as well as buying the underlying asset. This enables the use of leverage, as well as the option to open both short and long positions.
Bitcoin Exchange Traded Funds (ETFs) such as the Bitcoin Tracker Fund are a basket of securities that can be traded through Bitcoin brokers such as Interactive. They track the value of Bitcoin but trade on traditional market exchanges rather than cryptocurrency exchanges. Investors also have the opportunity to trade options and futures through Interactive Brokers, subject to meeting margin requirements.
Leverage
Leverage and margin investing is when a trader borrows capital from a Bitcoin platform so they can invest more with a lower outlay.
While this can result in higher returns, it also increases risk as losses will be amplified too. Eightcap is an example of a Bitcoin platform that provides the opportunity for traders to increase their buying power using leverage of 1:2 on all crypto-assets.
Interest
As well as Bitcoin trading, investors also have the opportunity to earn interest on BTC through a platform, which can be an excellent way to generate additional income. For example, Gemini offers 2% interest on Bitcoin holdings.
Note that this is not the same as crypto mining, which is done by individuals or as part of a mining pool.
Regulation
Using regulated Bitcoin brokers is highly recommended, as this ensures the company is abiding by certain rules and standards.
Top tier regulators include:
- Financial Conduct Authority (FCA) – UK
- Commodity Futures Trading Commission (CFTC) – US
- Cyprus Securities and Exchange Commission (CySEC) – Cyprus
- Australian Securities and Investments Commission (ASIC) – Australia
- European Securities and Markets Authority (ESMA) – European Union
However, regulation is often different for cryptos versus other assets. For example, while the FCA regulates cryptocurrency in the UK, consumers are unlikely to have access to the Financial Services Compensation Scheme (FSCS) for Bitcoin, meaning funds are not protected in the same way as when investing with traditional currency.
Equally, regulation does not apply to all countries. While the IG Group is among the top-rated Bitcoin brokers and platforms that is regulated by the FCA, one of its member companies IG Markets South Africa is not licensed to provide CFD products.
Security
2022 saw the collapse of FTX, among several other high-profile Bitcoin companies, raising questions about how some of the largest crypto exchanges manage client assets.
As a result, many traders are looking for legitimate Bitcoin firms with adequate safety and security protocols. One such measure is proof of reserves, which validates that a firm does indeed hold the BTC they claim to, meaning should users rush to withdraw funds, they have the capital to honour all requests.
Among the best Bitcoin brokers and exchanges that publish proof of reserves reports are BitMEX and OKX.
Platforms
The platform is the software provided by the broker or exchange used to carry out Bitcoin trading. The key things to look out for when researching a broker’s platform include:
- Indicators
- Chart types
- User interface
- Execution speed
- Demo account option
By signing up for a demo account, traders can try out the features offered by the platform risk-free, as well as practising technical strategies using charts and indicators. While many Bitcoin brokers offer the biggest platforms such as MetaTrader and cTrader, some also offer proprietary platforms with additional features.
AvaTrade is a Bitcoin broker that offers a vast array of platforms to suit all types of traders including their own platforms AvaTradeGO and AvaOptions, as well as the popular MetaTrader 4 (MT4) and MetaTrader 5 (MT5).
Accounts
All Bitcoin brokers offer accounts that come with associated terms including minimum deposit requirements and leverage options. While this varies between platforms, some firms also offer several account types to suit different investing needs.
Checking account restrictions is key to ensuring BTC investing will be viable. For example, traders looking to buy Bitcoin through Interactive Brokers need a minimum deposit of a huge $10,000. The IG Group has a more reasonable minimum deposit requirement of £250, while eToro requirements vary depending on customer location and deposit method.
Bonuses
Many platforms offer Bitcoin sign-up bonuses and promotions for new customers. This includes no-deposit bonuses, which means a platform gives a live account with a free bonus balance for investing.
Usually only profit can be withdrawn rather than the bonus itself, however this provides a great opportunity to start investing in Bitcoin without any risk.
Mobile Apps
Many Bitcoin brokers and exchanges now offer mobile apps for traders to manage BTC on the go. This could be a broker specific app, or a platform one such as the MetaTrader application.
Check the app is compatible with your operating system and look out for user reviews on the App Store and Google Play. In particular, ensure you can access any indicators or features you require to execute trades, as the functionality may be more limited than on the desktop platform.
Customer Support
The best Bitcoin brokers and exchanges offer high-quality technical support that typically includes:
- Telephone
- Contact forms
- Live chat services
Additionally, make sure the customer support option you need is available at the times of day you will be investing.
Deposits & Withdrawals
Bitcoin brokers and exchanges have various requirements for depositing and withdrawing funds, which may affect how much or when you can trade. Look out for deposit currency requirements, deposit and withdrawal methods (including debit/credit card and e-Wallets) plus processing times, which can be up to several working days.
There are also some brokers that accept Bitcoin payments as an online deposit and withdrawal method, which allows for a secure and fast transfer solution.
Alternative Tools
Crypto bots are becoming increasingly popular, providing the opportunity to automatically place Bitcoin trades using logic based on asset price or technical indicators. Numerous Bitcoin brokers and exchanges exclusively provide this automated investing service, including Bitcoin Evolution, Bitcoin Code, Bitcoin Era, Bitcoin Up, Bitcoin Loophole, Bitcoin Revolution and Bitcoin Profit.
However, traders should remain cautious about the legitimacy of these Bitcoin brokers, holding them to the same standards as more traditional exchanges.
Accepted Countries
There are usually restrictions on the countries from which BTC brokers accept customers, making it necessary to check the ‘supported countries’ list before trying to open a Bitcoin account.
Pepperstone is one of the best Bitcoin brokers and platforms that accept traders registered in Australia (including Sydney), New Zealand, Thailand, the United Kingdom, South Africa (including Cape Town and Durban), Singapore, India, Switzerland, France, Germany, Norway, Sweden, Italy, Denmark, United Arab Emirates (including Dubai), Saudi Arabia, Kuwait, Luxembourg, Qatar, Belgium, Azerbaijan, Jordan and Chile.
Swissquote is also a great option for clients in Canada (including Toronto), Hong Kong, Turkey, Japan, Saudi Arabia, Macau, Belize, China and Lebanon, while traders in Kenya can open an account with XM.
Unfortunately, investing is not permitted by either eToro or Swissquote for customers in Iran, Madagascar, Maldives, Botswana, Cameroon, Nigeria, Namibia or Zimbabwe.
What Is Bitcoin?
Unquestionably the most famous cryptocurrency, Bitcoin is a highly volatile asset that has seen extreme surges and declines over the past 10+ years. Bitcoin was the first blockchain currency to successfully record transactions and has a higher market capitalization than any other crypto. Yet BTC was not immune to the recent turbulence seen in the digital asset market, losing more than 60% of its value in 2022.
The Bitcoin white paper was released in 2008 by the pseudonym Satoshi Nakamoto, although the true identity of Satoshi remains a mystery. The decentralized technology is based around a public ledger that can be accessed by anyone and is independent of any government or bank.
Bitcoin brokers have caught the attention of traders such that BTC price movements now have a large impact on the price of other cryptocurrencies. As well as being secure, its popularity has increased its liquidity and accessibility, with generally fewer fees versus other digital assets.
How Bitcoin Works
The Bitcoin network itself is a collection of computers called nodes. Each Bitcoin is a piece of data that is stored in a crypto wallet.
A transaction is the transfer of value between Bitcoin wallets. Transactions are verified by a network of people running computers (mining) to solve complex algorithms, who receive rewards in the form of BTC for their efforts. Once verified, the transaction is added to the public online ledger, called the blockchain.
As everyone’s ledger should be the same, this makes it extremely difficult to claim ownership of more Bitcoin than someone has, making the crypto both transparent and secure.
How To Check Bitcoin Brokers Aren’t A Scam
Here we list the most important things to check to ensure Bitcoin brokers are legitimate:
- Reviews – user reviews and expert ratings are the best way to find out other people’s experience with an exchange or platform. In particular, look out for key indicators that Bitcoin brokers are safe including their reputation, history and any awards.
- Website – does the website feel legitimate? This is another key gauge as to whether a Bitcoin platform is genuine.
- Regulatory status – check the regulator’s website, whether that’s in the USA, UK or Europe, to confirm that regulation claims are real and to further gain confidence that the Bitcoin exchange isn’t fake.
- Offers – while some Bitcoin brokers and exchanges offer good bonuses, look out for deals that sound like they’re too good to be true – as this usually means they are.
Final Word On Bitcoin Brokers & Exchanges
Bitcoin brokers enable traders to profit off the highly volatile BTC blockchain, but selecting the right exchange is key to ensure you aren’t being scammed. Also consider the key services you need, whether that’s online investing with derivatives, P2P lending platforms, or Bitcoin storage.
Review our list to ensure you’ve considered the most important factors when selecting the best BTC brokers for your strategy.
FAQ
Do Brokers Sell Bitcoin?
Bitcoin can be bought from a broker or an exchange. However, brokers also provide additional services such as access to derivatives including futures and options, allowing traders to speculate on the price of Bitcoin without owning the underlying asset.
How Do Bitcoin Brokers Make Money?
Bitcoin brokers make money through the spread, by charging commission fees, or using a hybrid fee structure. The spread is the difference between the buy and sell price, while commissions fees are usually a flat fee applied to every transaction.
What Do Bitcoin Brokers Do?
Bitcoin brokers provide investors with access to a cryptocurrency exchange, which enables them to buy and sell BTC through a platform. The platform usually also contains charts and indicators for carrying out technical analysis.
What Are The Best Bitcoin Brokers In The UK?
Whilst partly dependant on your strategy and needs, among the top 5 UK regulated Bitcoin brokers are the IG Group, eToro, CityIndex, Swissquote and XTB.
What Are Legitimate Bitcoin Brokers?
Legitimate Bitcoin brokers are regulated by reputable authorities such as the CySEC. Check for good user reviews and a credible website when searching for safe Bitcoin brokers. Also look for appropriate security measures like segregated client funds and proof of reserves.